I'm pretty skeptical that Intel would ever have put a fab in the UK. It would make far far more sense to either locate it in Ireland where they already have a fab and therefore the expertise, to put in somewhere like Germany where key partners like the car companies are (as well as Munich being a great area for engineering talent), or frankly to stick it whereever they get the biggest subsidies from. Even as part of the EU, there is very little going for the UK as a fab site for Intel.
Germany has significant environmental regulations and oversight groups to overcome. Tesla succeeded by more or less with their “come at me bro” approach to regulatory hurdles. I doubt Intel shares that appetite for risk.
Exactly. As much as I want an Intel Fab in UK. Strategically speaking there is nothing UK to offer that give them a competitive advantage. Also agree on Ireland and Germany, or even Holland.
It also shows Intel is serious about being an IDM. And their expansion plan and OpeX are very aggressive, compare to TSMC which is a conservative company.
Intel puts fabs wherever they can get massive tax breaks or incentives. That's how Ireland ended up with one with the long term commitment that gives them the ability to recognise all their EU sales in a low tax location
UK has quite a good reputation from a silicon design perspective
About ten years ago (so may not still be accurate) there were more chip design companies concentrated around Bristol / Bath area than anywhere else outside Silicon Valley
Was often cited as a legacy of Transputer being based in Bristol / South Wales
I agree, though UK governments have been historically very willing to give tax breaks etc to encourage these things (Sony in Wales for instance). I'd assume that would be the counter to your points...
Currently UK has a massive tax on specialised workforce - you can easily pay more than 50% tax. They changed IR35 so that risk averse companies only hire in scope of rules to avoid potential costly investigation. Current UK market is very hostile.
Yeah Intel has built fabs in Israel and although it does have a very large and arguably very successful development center there it’s also a chicken and the egg so if you build it they will come…
I can’t see a situation in which the UK couldn’t have made a sufficiently enticing proposition when it comes to pure commercials.
That said I think the main factor here is that Intel is afraid of a protectionist EU policy as far as manufacturing IP goes with ASML being a Dutch company it puts the entire semi industry at the mercy of the EU if they do decide to push for a protectionist regime to bring back manufacturing closer to home.
Many other European companies also play a key role in the industry such as Philips (a lot of material engineering and manufacturing techniques) and Carl Zeiss (who makes the extremely specialized lenses and optical assemblies for lithography particularly for UV processes).
So whilst the EU doesn’t have manufacturing capacity especially when it comes to leading nodes they are in a better position to half the global production of advanced semi conductors and ICs than anyone else really.
"I have no idea whether we would have had a superior site from the UK," he said. "But we now have about 70 proposals for sites across Europe from maybe 10 different countries.
"We're hopeful that we'll get to agreement on a site, as well as support from the EU... before the end of this year."
May be UK was not suitable for an Intel fab before Brexit, but what is relevant now is not even an option.
Now think about any pan-European product or service and apply the same rule.
I also wouldn’t want to make a huge $multi-billion commitment to a country still shaking out its new trade, labor, and regulatory environment.
If Brexit becomes a permanent state of crisis, the UK will cease to attract inward investment.
On the other hand, if what we are currently seeing is just the teething pains of the new order combined with the post-pandemic-supply-chain-reboot, then I expect the UK will return to being a known quantity and more or less business as usual.
Even without the crisis, what upside does the UK have over the EU proper?
I feel like the UK was competitive when it was competing with European countries. Competing with countries in the EU? I just have no idea why anyone would invest in businesses there. It just feels like an inferior option, unless labor costs fall like a rock.
I think over time, the deals the UK gets will get worse and worse, not just on investment, but on everything.
It doesn't help that China still thinks of opium wars when the UK comes up, India things of the British Empire, and much of the rest of the world feels the same way. The UK was always respected, but never loved. If that respect goes away...
You got what you asked for. They will get no sympathy from me.
Sure they were lied and tricked but they are adults. If they spent a second thinking about potential fallout then maybe they would make a smarter decision.
* Prior to Brexit, I reckon the UK's main selling-point to US and Asian multinationals was that it's a perfect beachhead into mainland Europe, namely as everyone speaks English already, so localization (well, localisation) doesn't need to be a concern at-first, and allows companies to test-the-water by marketing locally in the British Isles before expanding into the rest of mainland Europe.
* As the UK's regulatory environment was in the EU it meant that getting sign-off from British regulators (again: where language and cultural-barriers won't be an issue) is more straightforward as you don't need to seek regulatory approval in every EU country, only 1.
* Extant supply of highly-qualified, if not world-leading, scientists, researchers and engineers and access to its higher-education system - and those researchers and engs would have included more of mainland Europe's best too due to greater academic collaboration within the EU.
Post-Brexit: all the UK has is... speaking English, and that's it. Now non-EU companies need to seek regulatory approval in both the EU and UK - and the EU's market is considerably larger.
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I reckon within a decade the UK will find some way to rejoin the more important parts of the EU in-all-but-name, including (possibly!) even joining Schengen to alleviate all of the issues with labour shortages, tourism, and the rest - as well as seeking de-jure regulatory alignment - because the UK is really not the super-desirable market the Daily Express likes to believe it is.
I also sincerely believe the UK will also likely rejoin the EU proper - probably within a generation from now: the age demographics of the leave and remain demographics are stark - it's even been said if the Brexit referendum were held 2 years later then remain would have won simply because enough members of older generations (which lean heavily Leave) would have died off.
"I also sincerely believe the UK will also likely rejoin the EU proper" Really? Assuming there's even a UK in future and it hasn't fractured into separate countries, why would the EU ever have us back after the enormous amount of trouble the UK (well England, to be fair) has caused? It only takes 1 EU country to object...
Ireland will play a blinder if they manage to attract UK companies and employees who rely on access to the EU. The Common Travel Area means they can just pack up and go.
> if the Brexit referendum were held 2 years later then remain would have won simply because enough members of older generations (which lean heavily Leave) would have died off.
Isn't it also possible that some remainers, a few years older, would have changed their mind?
Lots to unpick. On your point about schengen: schengen does nothing to tourism (UK was not part of schenghen and the list of visa free countries for tourism is pretty much the same between Schenghen and the UK) or labour shortage (Schenghen isn’t about your right to work, EU citizens had the right to work in the UK even though the UK wasn’t in schenghen).
And the point visa makes it pretty much trivial for well paid engineers to get a work visa in the UK. Where it makes it difficult is for low wage, low skill labour, which will create shortages, but I think that’s by design, whether you think it’s a good idea or not.
I don’t think that tariffs would affect CPU much either, I understand it is mostly cars or agricultural products that are deeply affected. Not the least because you can see that the EU is importing most of its CPUs right now, doesn’t seem to be much of a barrier.
I wouldn’t bet too much on the demographics helping remain in the long term. By conformism or risk aversion mostly there tends to always be a large mass behind the statu quo (which is why brexit winning was surprising). I think that will play both ways.
Readit News
[0]: In France, Grenoble could be a good place. Anyway, everywhere in the EU would be good for the world level balance.
It also shows Intel is serious about being an IDM. And their expansion plan and OpeX are very aggressive, compare to TSMC which is a conservative company.
About ten years ago (so may not still be accurate) there were more chip design companies concentrated around Bristol / Bath area than anywhere else outside Silicon Valley
Was often cited as a legacy of Transputer being based in Bristol / South Wales
I can’t see a situation in which the UK couldn’t have made a sufficiently enticing proposition when it comes to pure commercials.
That said I think the main factor here is that Intel is afraid of a protectionist EU policy as far as manufacturing IP goes with ASML being a Dutch company it puts the entire semi industry at the mercy of the EU if they do decide to push for a protectionist regime to bring back manufacturing closer to home.
Many other European companies also play a key role in the industry such as Philips (a lot of material engineering and manufacturing techniques) and Carl Zeiss (who makes the extremely specialized lenses and optical assemblies for lithography particularly for UV processes).
So whilst the EU doesn’t have manufacturing capacity especially when it comes to leading nodes they are in a better position to half the global production of advanced semi conductors and ICs than anyone else really.
https://www.bbc.co.uk/news/business-58820599
"I have no idea whether we would have had a superior site from the UK," he said. "But we now have about 70 proposals for sites across Europe from maybe 10 different countries.
"We're hopeful that we'll get to agreement on a site, as well as support from the EU... before the end of this year."
If Brexit becomes a permanent state of crisis, the UK will cease to attract inward investment.
On the other hand, if what we are currently seeing is just the teething pains of the new order combined with the post-pandemic-supply-chain-reboot, then I expect the UK will return to being a known quantity and more or less business as usual.
I feel like the UK was competitive when it was competing with European countries. Competing with countries in the EU? I just have no idea why anyone would invest in businesses there. It just feels like an inferior option, unless labor costs fall like a rock.
I think over time, the deals the UK gets will get worse and worse, not just on investment, but on everything.
It doesn't help that China still thinks of opium wars when the UK comes up, India things of the British Empire, and much of the rest of the world feels the same way. The UK was always respected, but never loved. If that respect goes away...
Something feels very rotten about British society today.
Sure they were lied and tricked but they are adults. If they spent a second thinking about potential fallout then maybe they would make a smarter decision.
* Prior to Brexit, I reckon the UK's main selling-point to US and Asian multinationals was that it's a perfect beachhead into mainland Europe, namely as everyone speaks English already, so localization (well, localisation) doesn't need to be a concern at-first, and allows companies to test-the-water by marketing locally in the British Isles before expanding into the rest of mainland Europe.
* As the UK's regulatory environment was in the EU it meant that getting sign-off from British regulators (again: where language and cultural-barriers won't be an issue) is more straightforward as you don't need to seek regulatory approval in every EU country, only 1.
* Extant supply of highly-qualified, if not world-leading, scientists, researchers and engineers and access to its higher-education system - and those researchers and engs would have included more of mainland Europe's best too due to greater academic collaboration within the EU.
Post-Brexit: all the UK has is... speaking English, and that's it. Now non-EU companies need to seek regulatory approval in both the EU and UK - and the EU's market is considerably larger.
------
I reckon within a decade the UK will find some way to rejoin the more important parts of the EU in-all-but-name, including (possibly!) even joining Schengen to alleviate all of the issues with labour shortages, tourism, and the rest - as well as seeking de-jure regulatory alignment - because the UK is really not the super-desirable market the Daily Express likes to believe it is.
I also sincerely believe the UK will also likely rejoin the EU proper - probably within a generation from now: the age demographics of the leave and remain demographics are stark - it's even been said if the Brexit referendum were held 2 years later then remain would have won simply because enough members of older generations (which lean heavily Leave) would have died off.
Isn't it also possible that some remainers, a few years older, would have changed their mind?
Dead Comment
And the point visa makes it pretty much trivial for well paid engineers to get a work visa in the UK. Where it makes it difficult is for low wage, low skill labour, which will create shortages, but I think that’s by design, whether you think it’s a good idea or not.
I don’t think that tariffs would affect CPU much either, I understand it is mostly cars or agricultural products that are deeply affected. Not the least because you can see that the EU is importing most of its CPUs right now, doesn’t seem to be much of a barrier.
I wouldn’t bet too much on the demographics helping remain in the long term. By conformism or risk aversion mostly there tends to always be a large mass behind the statu quo (which is why brexit winning was surprising). I think that will play both ways.